Govt. wants to structurally transform state through reforms in ten areas

A national reform programme for this year which will be presented at a government session on Thursday brings a series of measures in ten key areas with a view to solving Croatia's structural problems, also in line with Council of the European Union recommendations.

The government is expected to submit a document with ten key reform proposals to the European Commission by the end of this month.

The reforms refer to health care, the pension system, public administration, the school curriculum, the management of public companies, reducing the number of non-strategic state-owned properties, a more equitable allocation of social benefits, bringing land registers in order, bigger investments in research and development, and eliminating obstacles to doing business.

The pension system reform envisages, among other things, raising the retirement age from 65 to 67 years as well as the age for early retirement from 60 to 62, in order to reduce the number of new pensioners and alleviate the pressure on the state budget. These announcements have already been criticized by unions.

The public administration reform envisages, among other things, a new pay system and downsizing the number of agencies in order to enhance the work of civil servants, cut expenses and improve the quality of public services.

The reforms envisage a more efficient way of managing public companies as well as selling non-strategic state-owned properties, with a view to earning at least EUR 500 million this year to reduce the public debt.

The government plans to further reduce parafiscal levies by HRK 300 million to reduce taxes for businesses and improve the entrepreneurial climate. The reform envisages bringing order to land registers in the second half of the year and introducing a property tax in the years ahead.

The implementation of a smart specialisation strategy, which envisages directing investment in areas with the biggest growth potential, and EUR 664 million at Croatia's disposal from European Union funds are expected to make the economy more competitive.

The introduction of a means test is expected to make social benefits more equitable and more effective, while the introduction of a curricular reform is expected as of the next school year, with a view to better aligning education with social and economic requirements.

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